Roche Unlikely to Buy Rest of Genentech

Roche Holding, Europe’s No. 5 drug maker, is unlikely to exercise its option to buy the 34% of Genentech Inc. it doesn’t already own, investors say.

Roche can buy the shares any time before July 1, the expiration of a 1995 agreement that gave the drug maker the right to acquire all of South San Francisco-based Genentech, one of the world’s biggest biotech companies.

Genentech management has said the company is doing fine on its own and would like it to remain independent from Roche. A consensus is now emerging on Wall Street that the Swiss drug maker will keep things as they are, given Genentech’s recent success in introducing two new cancer drugs and the strong outlook for its pipeline of drugs in development.

Roche has declined to comment about its plans for Genentech.

If Roche were to exercise its options to buy the Genentech shares this quarter, it would pay $79.50 a share for the remainder of Genentech. The price will rise to $81 in January and $82.50 on April 1.